EDF REsource Capital Inc., a now-defunct Folsom firm that brokered and serviced Small Business Administration loans, and its former chief executive officer, Frank Dinsmore, have agreed to pay the federal government $6 million in cash and assets to settle allegations that EDF failed to remit payments owed to the SBA, U.S. Attorney Benjamin Wagner announced Friday.

The SBA 504 loan program provides growing businesses with long-term, fixed-rate financing for major fixed assets, such as land and buildings. Local lenders like EDF are responsible for arranging, servicing and collecting on the loans, which are guaranteed, in part, by the SBA. EDF was required to bear a share of any losses suffered by the SBA and to maintain a loan loss reserve fund.

The settlement resolves claims that EDF and Dinsmore violated the federal False Claims Act in connection with EDF’s failure to maintain adequate reserves in its loan loss reserve fund.

The pact also resolves a lawsuit filed by the United States against EDF and a related entity, Redemption Reliance LLC, alleging that EDF failed to remit required payments to the SBA to satisfy its loss-sharing obligations.

The lawsuit also alleged that the SBA advanced funds to EDF in connection with some defaulted 504 loans, but that, after EDF assigned the loans to Redemption Reliance, neither EDF nor Redemption Reliance remitted monies owed to the SBA in connection with these loans.